Compute the current ratio and quick ratio

Reference no: EM13215069

The 2007 and 2008 balance sheets for Alan Jack and Sons showed net accounts receivable of $10,000 and $14,000, respectively, and inventory of $8,000 and $6,000, respectively. Their 2008 income statement showed net sales of $109,500 and cost of goods sold of $70,000. Compute the following ratios for 2008:
1. Accounts receivable turnover.
2. Days' sales in receivables.
3. Inventory turnover.

In addition to the information from the answers on L9A1, assume that cash on the 2008 balance sheet was $20,000 and current liabilities totaled $24,000. Compute the following ratios for 2008:
1. Current ratio.
2. Quick ratio.

Reference no: EM13215069

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